Constellation Brands, Inc. Class A (STZ)

Over the past six months, Constellation Brands' stock price has been influenced by several events. The company reported its fiscal third-quarter 2026 earnings on January 7, 2026, exceeding revenue and EPS expectations, although net sales declined by 10% year-over-year due to strategic divestitures. Management cautioned about anticipated headwinds in the fourth quarter, including seasonality and increased aluminum tariffs. In its fiscal second-quarter 2026 results reported on October 6, 2025, net sales declined by approximately 15% year-over-year, missing expectations. Strategic divestitures have significantly impacted the company's fiscal year 2026 financial projections, leading to a projected 4-6% decrease in organic net sales. The stock price bottomed out around $120 in November 2025 and has since shown an upward trend.

Demand for Constellation Brands' products exhibits seasonality, with the fiscal fourth quarter typically being the lowest in terms of volume. This seasonality can lead to increased fixed overhead absorption and compressed margins during this period. Consumer preferences are also influencing demand, with a notable shift towards premium and artisanal products. Economic pressures and immigration-related concerns affecting Hispanic consumers have impacted demand for Constellation Brands' products.

Constellation Brands, Inc. (STZ) is a Fortune 500 company and the largest beer import company in the United States. It operates within the alcoholic beverages industry, producing, marketing, and selling a diverse portfolio of alcoholic beverages, with a focus on premium brands. Its major products include a high-end imported beer portfolio featuring brands such as Corona Extra and Modelo Especial, and wine and spirits brands like Robert Mondavi and Casa Noble Tequila. Constellation Brands also holds investments in the cannabis market through its association with Canopy Growth.

Constellation Brands operates across the U.S., Mexico, New Zealand, and Italy. Approximately 98.1% of its net sales are generated in the United States. The company operates breweries in Mexico to produce Corona and Modelo beer for the U.S. market, with a third brewery planned for Veracruz, Mexico.

In the past year, Constellation Brands has generally maintained a positive brand reputation, characterized by strong brand recognition and market presence. The company emphasizes its commitment to sustainability and responsible practices. However, the company's reputation has faced some challenges, including below-average performance in the 2023 Nature Benchmark and the impact of declining alcohol consumption. The imposition of U.S. tariffs on aluminum imports has created cost pressures. The company has also acknowledged pressure on its Hispanic consumer base due to macroeconomic factors and immigration-related concerns.

Constellation Brands' ownership is largely institutional, with institutional shareholders holding approximately 63.46% to 82.3% of the company's shares. Major institutional owners include Vanguard Group Inc. and Berkshire Hathaway Inc. Individual and insider ownership accounts for about 12.2% of shares, with key individual and insider owners including Wildstar Partners LLC and Robert Sands.